1. Sales are expected to be $81,000 in January, $101.000 in February, and $106,000 in March 2. All sales are on credit and it collects 20% of all sales in the month of the sale, the remaining 80% in the month after the sale. 3. The cost of goods sold is equal to 40% of sales. 4. The company likes to keep an ending inventory on hand equal to 15% of next month's cost of goods sold. 5. All purchases of inventory are on account, and the company pays for 60% of all purchases in the month of the purchase, 40% In the month after the purchase. 6. The company pays its sales force a commission equal to 3% of sales. 7. The company also believes that its miscellaneous expense is equal to $500 plus 2% of sales. 8. Rent is $2.000 per month, Supplies are $600 per month and Depreciation is $1,800 per month 9. On January 1st the company purchased an insurance policy covering 24 months for $28.800 10. All selling and administrative expenses are paid in the month they are incurred except for commissions that are paid in the month after they are earned and the insurance which is paid two year in advance. 11. The company purchased $4,000 of Land on February 18th. They paid cash for the land.. 12. Interest on long-term debt is equal to 1% of the beginning balance and is paid each month. The company must maintain a minimum balance in cash of $15.000 and will use any cash surplus to pay down long-term debt. The company borrows cash in $1,000 increments. 13. The company is subject to a 30% income tax rate. The company pays income taxes in the month after they are accrued (expensed) 14. The company's Board of Directors declared a cash dividend of $950 on January 4th. The dividend will be paid on February 10th 15. The company had a beginning balance sheet (as of January 1) as follows: Assets Liabilities & SE Current Assets Current Liabilities Cash $16,000 Accounts Payable $23.500 Accounts Receivable 48.000 Commissions Payable 3,400 Prepaid Insurance O Income Taxes Payable 9.275 Inventory 9600 Dividends Payable Total Current Assets 73,600 Total Current Liabilities 36,175 Long-term Debt 80,000 Property. Plant & Equipment Equipment Land Accumulated Depreciation Net PPE 95.000 Stockholders Equity 8,800 Common Stock 225.000) Return Earnings 78.800 Total SE 26,225 10000 36.225 Total Assets $152,400 Total Liabilities & SE $152,400 Babcats Company's partically completed master budget is as follows: Sales Budget January $81.000 February $101.000 March ST06 000 Credit Sales Cash Receipts from Customers From Current Month Credit Sales From Prior Month Credit Sales Total Cash Receipts from Customers (1) (Click to select) Save & Exit Submit Inventory Purchases Budget January February $40.400 March $42,400 COGS Desired Ending Inventory Total INventory Needed Beginning Inventory Inventory Purchases (2) (Click to select) Cash Payments for Inventory Purchases For Current Month Purchases For Prior Month Purchases Total Cash Payments for Inventory Purchases (3) $40.816 (Click to select) Selling & Administrative Expenses Budget January February Variable Selling & Administrative Expenses Commissions (Click to select) Miscellaneous Total Variable S&A Expenses 4,050 5,050 2.000 2.000 Fixed Selling & Administrative Expenses Miscellaneous Rent Supplies Depreciation Insurance Total Fixed S&A Expenses 1.800 1,800 (5) (Click to select) $6100 $6,100 Cash Payments for S&A Expenses Commissions Utilities Advertising Salaries Depreciation (6) (Click to select) Insurance Total Cash Payments for S&A Expenses (7) (Click to select) $7.550 $36.920 Cash Budget Cash Budget January February Beginning Cash Balance Cash Receipts from Customers Total Cash Available 80,200 Cash Payments For Inventory Purchases For S&A Expenses 40.816 For Interest (8) (Click to select) For Income Taxes For Land Purchase For Dividends Total Cash Payments 87,811 Surplus (Deficit) (9) (Click to select) 39,600 Borrowing (Repayment) Ending Cash Balance (10) (Click to select) $ 15,000 Income Statement January $81,000 February $101.000 Sales Less: Variable Expenses COGS Variable S&A Expenses Contrinbution Margin Less: Fixed Expenses Fixed S&A Expenses Interest Expense Pre-tax Net Income Income Taxes Expense After-tax Net Income (11) (Click to select) 11,295 $26,355 14,526 $33.894 Balance Sheet Assets Current Assets Liabilities & SE Current Liabilities Cash Accounts Payable (12) (Click to select) (13) (Click to select) (18) (Click to select) Accounts Receivable Commissions Payable (19) (Click to select) Prepaid Insurance (14) (Click to select) Income Taxes Payable Inventory (15) (Click to select) Dividends Payable (20) (Click to select) Total Current Assets Total Current Liabilities Long-term Debt (21) (Click to select) Property, Plant & Equipment Equipment 95,000 Land 26.225 26,225 Accumulated Depreciation (17) (Click to select) 95,000 Stockholders Equity (16) Common Stock (Click to select) Return Earnings Total SE $207,760 Total Liabilities & SE (22) (Click to select) Net PPE Total Assets $190,849 $190,849 $207,760 1. Sales are expected to be $81,000 in January, $101.000 in February, and $106,000 in March 2. All sales are on credit and it collects 20% of all sales in the month of the sale, the remaining 80% in the month after the sale. 3. The cost of goods sold is equal to 40% of sales. 4. The company likes to keep an ending inventory on hand equal to 15% of next month's cost of goods sold. 5. All purchases of inventory are on account, and the company pays for 60% of all purchases in the month of the purchase, 40% In the month after the purchase. 6. The company pays its sales force a commission equal to 3% of sales. 7. The company also believes that its miscellaneous expense is equal to $500 plus 2% of sales. 8. Rent is $2.000 per month, Supplies are $600 per month and Depreciation is $1,800 per month 9. On January 1st the company purchased an insurance policy covering 24 months for $28.800 10. All selling and administrative expenses are paid in the month they are incurred except for commissions that are paid in the month after they are earned and the insurance which is paid two year in advance. 11. The company purchased $4,000 of Land on February 18th. They paid cash for the land.. 12. Interest on long-term debt is equal to 1% of the beginning balance and is paid each month. The company must maintain a minimum balance in cash of $15.000 and will use any cash surplus to pay down long-term debt. The company borrows cash in $1,000 increments. 13. The company is subject to a 30% income tax rate. The company pays income taxes in the month after they are accrued (expensed) 14. The company's Board of Directors declared a cash dividend of $950 on January 4th. The dividend will be paid on February 10th 15. The company had a beginning balance sheet (as of January 1) as follows: Assets Liabilities & SE Current Assets Current Liabilities Cash $16,000 Accounts Payable $23.500 Accounts Receivable 48.000 Commissions Payable 3,400 Prepaid Insurance O Income Taxes Payable 9.275 Inventory 9600 Dividends Payable Total Current Assets 73,600 Total Current Liabilities 36,175 Long-term Debt 80,000 Property. Plant & Equipment Equipment Land Accumulated Depreciation Net PPE 95.000 Stockholders Equity 8,800 Common Stock 225.000) Return Earnings 78.800 Total SE 26,225 10000 36.225 Total Assets $152,400 Total Liabilities & SE $152,400 Babcats Company's partically completed master budget is as follows: Sales Budget January $81.000 February $101.000 March ST06 000 Credit Sales Cash Receipts from Customers From Current Month Credit Sales From Prior Month Credit Sales Total Cash Receipts from Customers (1) (Click to select) Save & Exit Submit Inventory Purchases Budget January February $40.400 March $42,400 COGS Desired Ending Inventory Total INventory Needed Beginning Inventory Inventory Purchases (2) (Click to select) Cash Payments for Inventory Purchases For Current Month Purchases For Prior Month Purchases Total Cash Payments for Inventory Purchases (3) $40.816 (Click to select) Selling & Administrative Expenses Budget January February Variable Selling & Administrative Expenses Commissions (Click to select) Miscellaneous Total Variable S&A Expenses 4,050 5,050 2.000 2.000 Fixed Selling & Administrative Expenses Miscellaneous Rent Supplies Depreciation Insurance Total Fixed S&A Expenses 1.800 1,800 (5) (Click to select) $6100 $6,100 Cash Payments for S&A Expenses Commissions Utilities Advertising Salaries Depreciation (6) (Click to select) Insurance Total Cash Payments for S&A Expenses (7) (Click to select) $7.550 $36.920 Cash Budget Cash Budget January February Beginning Cash Balance Cash Receipts from Customers Total Cash Available 80,200 Cash Payments For Inventory Purchases For S&A Expenses 40.816 For Interest (8) (Click to select) For Income Taxes For Land Purchase For Dividends Total Cash Payments 87,811 Surplus (Deficit) (9) (Click to select) 39,600 Borrowing (Repayment) Ending Cash Balance (10) (Click to select) $ 15,000 Income Statement January $81,000 February $101.000 Sales Less: Variable Expenses COGS Variable S&A Expenses Contrinbution Margin Less: Fixed Expenses Fixed S&A Expenses Interest Expense Pre-tax Net Income Income Taxes Expense After-tax Net Income (11) (Click to select) 11,295 $26,355 14,526 $33.894 Balance Sheet Assets Current Assets Liabilities & SE Current Liabilities Cash Accounts Payable (12) (Click to select) (13) (Click to select) (18) (Click to select) Accounts Receivable Commissions Payable (19) (Click to select) Prepaid Insurance (14) (Click to select) Income Taxes Payable Inventory (15) (Click to select) Dividends Payable (20) (Click to select) Total Current Assets Total Current Liabilities Long-term Debt (21) (Click to select) Property, Plant & Equipment Equipment 95,000 Land 26.225 26,225 Accumulated Depreciation (17) (Click to select) 95,000 Stockholders Equity (16) Common Stock (Click to select) Return Earnings Total SE $207,760 Total Liabilities & SE (22) (Click to select) Net PPE Total Assets $190,849 $190,849 $207,760